Charting the dismal employment report

By Kurt Brouwer

Where to start? Today’s jobs report was bad. Not horrible, but bad nonetheless. The unemployment rate went up to 9.1%, rather than down as many ‘economists’ expected. Also, the level of new jobs was very low at 54,000. On top of that, the two previous months job gains were revised downward. All in all, this was a disappointing report.

Before we go to the chart, this MarketWatch report has the details [emphasis added]:

…Nonfarm payrolls rose by a seasonally adjusted 54,000 in May. This is the smallest gain since September and a fraction of the 125,000 jobs expected by economists polled by MarketWatch.

…The official unemployment rate increased to 9.1% in May from 9.0% in April. This is the highest unemployment rate since December. Economists were expected a slight drop in the jobless rate to 8.9%…

What does this mean in terms of getting Americans back to work? Well, we are just not making a dent in the ranks of unemployed people. This chart shows what it would take to get us back to the employment level of December 2007, if you take into account approximately 90,000 new folks joining the work force each month:

As this chart illustrates, we would need to average 250,000 new jobs per month for over five years to get back to where we were in December 2007. I hope we can do so, but given today’s report, we are a long, long way from adding 250,000 new jobs per month.

For the full Non Farm Payroll (NFP) report from the Bureau of Labor Statistics, click here

Update: In light of the dismal jobs report, it’s worth asking, why is Texas adding jobs, while the rest of the country fails?

About Fundmastery Blog

Kurt Brouwer is a fee-only financial advisor with three decades of experience. He is the chairman and co-founder of Brouwer & Janachowski, LLC. Kurt has written books, articles and hundreds of blog posts on mutual funds, ETFs and other investment topics. E-mail: kurt.brouwer *at* gmail.com.